Seminars & webinars
19 January, 2017

FEEM-IEFE Joint Seminar on "The RES-induced Switching effect Across Fossil Fuels: an Analysis of the Italian Day-Ahead and Balancing Prices and Their Connected Costs"

Where: Milan

Bocconi University
Via Sarfatti, 25
20136 Milan
Video-conference at FEEM Venice

How to reach: Google map
Event's Timetable:

h. 12.30 Seminar
In Milan a light lunch will follow the seminar for registered participants.

Information: Registration is required. Please confirm your participation to:
IEFE Secretary: by Tuesday 17 January.
To attend the seminar in Venice or via GoToMeeting, please register here.

Lucia Parisio, DEMS, University of Milano-Bicocca


Co-authors: Angelica Gianfreda, Lucia Parisio, and Matteo Pelagatti

The massive introduction of RES in electricity markets has in influenced the long-run dynamics of electricity prices and their interactions with conventional thermal production sources. Taking into account the Northern Italian zone characterized by a high solar PV and hydro penetration, we  firstly provide empirical evidence on the fuels-electricity nexus across two samples characterized by low (2006-08) and high (2013-15) RES levels, both in the day-ahead and balancing markets. Then, we estimate the costs for balancing power disentangling for technologies and comparing their dynamics across specific c hours in both samples. We show that the fuels-electricity nexus has changed significantly in the day-ahead sessions and selectively in the balancing sessions. We also  find evidence of high balancing prices that we interpret as a signal of strategic use of real time sessions by conventional producers. Our findings suggest policy makers to carefully monitor all trading sessions, especially those close to real time, to avoid the exercise of market power by few operators allowed to guarantee system security and to promptly adopt a capacity market.

This seminar has been jointly organized by FEEM and IEFE, Bocconi University.

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